Enactment of PIA attracts over $16bn investment commitments — Deputy Speaker

Deputy Speaker of the House of Representatives, Hon. Benjamin Kalu on Monday expressed excitement over the pivotal role played by the National Assembly in the enactment of Petroleum Industry Act (PIA), 2021 which yielded over $16 billion investment commitments, significant improvements in oil production, robust revenue generation, and a vastly improved regulatory compliance landscape.

The Deputy Speaker made the observation in Abuja, while delivering lecture on: ‘Legislation as an enabler of compliance, investment, and sector growth: The role of the National Assembly in strengthening the Post-PIA Petroleum landscape’, during the opening of the ‘Nigerian Midstream and Downstream Petroleum Regulatory Authority General Counsel and Legal Advisers Forum for Midstream and Downstream Petroleum Companies in Nigeria 2025’.

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According to him, “the most compelling testament to the PIA’s success is its remarkable ability to attract substantial foreign and domestic investment. The legislation has cultivated a far more favorable investment climate through a combination of crucial fiscal incentives and unprecedented regulatory clarity.”

In his analysis of the Post-PIA impact, he said: “Just two years post-enactment, the impact of the PIA is undeniable. We have witnessed an astonishing $16 billion in investment commitments, a staggering 28,991% increase from our pre-PIA baseline of a mere $0.055 billion in 2020. These are not just numbers; they represent jobs, infrastructure, and a renewed sense of purpose for our nation’s most vital economic engine.

“At its core, the PIA 2021 has established a robust legal framework that has dramatically enhanced regulatory compliance across Nigeria’s petroleum sector. Before the PIA, we operated under a fragmented regulatory structure, a table of overlapping mandates that hindered efficiency and accountability. The PIA swept this away, creating two distinct, powerful regulatory bodies: the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) and the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA). This clear delineation of roles has been a game-changer.

“Let us look at the data. According to NEITI audits, our baseline compliance rate in 2015 stood at 94%. While seemingly high, it masked underlying inefficiencies and vulnerabilities. Post-PIA implementation, we have seen a tangible enhancement in regulatory effectiveness. The NUPRC alone generated an astounding ₦4.344 trillion in revenue during 2023, representing a 14.89% increase compared to 2022 figures.

“This is not just about collection; it’s about a more efficient and transparent system at work. The Commission has successfully issued 12 gazetted regulations, providing the much-needed clarity and predictability that investors crave.

“Simultaneously, it has maintained strict oversight over 571 oil spill incidents, diligently investigating each one. It is a sobering fact that 59.01% of these spills were attributed to sabotage, a challenge we will address further.

“The Act’s comprehensive regulatory framework addresses critical compliance areas that were previously, at best, inconsistently enforced: Environmental management and gas flaring controls: The PIA mandates rigorous environmental impact assessments and establishes clear penalties for non-compliance, pushing us towards a greener and more responsible energy sector.”

According to him, statistical evidence overwhelmingly supports the PIA’s success: from a truly astounding 28,991% increase in investment to achieving 1.69 million barrels per day in oil production and generating ₦50.88 trillion in revenue. These figures are not just encouraging; they are a clear validation of the PIA’s effectiveness.

While assuring that the Parliament will not rest on our laurels, he admitted that: “continued legislative attention is absolutely required to address the lingering implementation challenges, particularly the persistent and economically crippling issue of oil theft, which continues to cost Nigeria approximately $79.4 million daily. This is a battle we must win.

“The path forward demands sustained engagement from the National Assembly. This means enhanced oversight, carefully targeted legislation to address our security challenges, and unwavering support for our regulatory agencies. By diligently building on the robust foundation laid by the PIA, Nigeria can not only achieve its goal of becoming a leading global petroleum producer but also ensure sustainable development for our host communities and the broader Nigerian economy.

“The PIA experience offers a compelling and inspiring model for other resource-dependent nations seeking to transform their extractive industries through legislative action. It demonstrates, with irrefutable evidence, that with political will, broad stakeholder engagement, and comprehensive regulatory reform, legislation can indeed serve as a powerful catalyst for economic transformation and sustainable development in the petroleum sector.”

The Deputy Speaker who was represented by Chairman House Committee on Petroleum (Downstream), Hon. Ikenga Ugochinyere maintained that the Act has fundamentally reshaped Nigeria’s petroleum sector, proving unequivocally how strategic legislation can serve as a potent catalyst for compliance, investment attraction, and robust sector growth.

He maintained that the introduction of competitive bidding processes and streamlined approval mechanisms has significantly reduced opportunities for corruption and increased investor confidence.

Hon. Kalu also expressed excitement over the provision for the host community development, with the allocation of 30% of production sharing contracts to community development, ensuring that the very communities bearing the brunt of petroleum operations directly benefit from the wealth generated, fostering peace and stability.

He also highlighted the successes achieved under the present administration, with the introduction of Executive Orders 40, 41, and 42 in 2024 by President Bola Ahmed Tinubu, which further bolstered confidence by providing additional fiscal benefits and streamlined contracting processes. These are proactive measures demonstrating our commitment to creating a truly attractive investment landscape.

In his remarks, NMDPRA Chief Executive, Engineer Farouk Ahmed averred that the industry continues to be a key driver of revenue and a catalyst for industrial growth, energy access, and national development.

Engineer Farouk who was represented by the Executive Director, Distribution Systems, Storage and Retailing Infrastructure, Ogbugo Ukoha explained that the “scope of operations of the sector covers hydrocarbon processing, wholesale marketing, transportation, storage, distribution and retail and its complexity requires more than technical efficiency. It requires a unified compliance culture rooted in robust and enabling legal frameworks, transparency, accountability, and shared responsibility.”

While describing the role of legal practitioners as critical across the midstream and downstream energy business value chain in the promotion of optimal regulatory compliance to all set rules and standards of operations in our complex operational and volatile market environment, he averred that the Petroleum Industry Act 2021 has fundamentally restructured Nigeria’s petroleum industry by delineating regulatory responsibilities of our Industry into the Upstream and the Midstream and Downstream Petroleum operations.

“The Act prescribes that all operations in the midstream and downstream sector can only be conducted under appropriate licenses, permits and authorizations granted by the NMDPRA and the Authority is fully guided by the provisions of the law in providing regulatory oversight of the Industry.”

He disclosed that the Agency is implementing an inclusive stakeholder process of streamlining the gazetted and published regulations to: mitigate the complexities of navigating and implementing numerous regulations; eliminate inconsistencies and repetitions across multiple regulations; streamline regulatory processes for ease of business; and encourage investments in the midstream and downstream
petroleum industry.

Presenting a paper on ‘Aligning the Legal Advisory Role with Regulatory Mandates and Operational Realities in the Midstream and Downstream Petroleum Industry’, NMDPRA Secretary and Legal Adviser, Dr. Joseph Tolorunse harped on the need for Legal Advisers to be familiar with the licence regime under the PIA.

“Legal advisers must understand the licence regime under the PIA. They have various licences under the PIA. Don’t be mistaken, there are over 17 types of licences under the PIA that exist within the mainstream and outsourced space. So, legal advisors must understand the penal licence regime under the PIA.

“Legal advisers are encouraged to integrate alternative peaceful resolution into their internal policies, contracts, agreements, and peaceful management processes.

“Legal Advisers must be accountable for monitoring and reporting involving regulations. Advising must be made in compliance, rather than reactive reaction. Engaging legal advisers and participating in industry consultation and supporting the government in relations and policy and advocacy. This approach ensures that businesses are not only compliant, but also adapted to policy trends,” he said.